What's New for the Tax Filing Season

Here are some of the most important changes and benefits affecting the approximately three million taxpayers working on their 2007 Maryland income tax returns due to be filed by April 15, 2008. (The income tax changes enacted during last year’s special session of the General Assembly do not affect the 2007 Maryland income tax return.)

• Expanded military retirement tax break – The military retirement income tax subtraction benefit of up to $5,000 now applies to qualifying individuals who retired before July 1, 1991 from active duty with the Commissioned Corps of the Public Health Service, the National Oceanic and Atmospheric Administration (NOAA), or the Coast and Geodetic Survey. More
• Increased pension exclusion - Maryland's maximum pension exclusion, which is available to qualifying taxpayers 65 or older, increased from $22,600 to $23,600 for tax year 2007. More
• Expanded earned income tax credit - The maximum earned income amounts used for claiming Maryland's earned income credit have been increased, allowing more individuals to qualify for the tax benefit. More
• Estimated taxpayers – The new tax rates enacted during the 2007 special session of the General Assembly apply to taxpayers paying estimated taxes for 2008. See Form 502D More
• Reduced local income tax rate for Prince George’s County - The local income tax rate for Prince George’s County has been reduced from .0320 to .0310 for tax year 2007. More
• Online payment option for existing personal tax liability - Taxpayers who have an existing personal tax liability can now pay online. More
• Power of attorney - We now accept federal forms 2848 and 8821 as power of attorney forms for Maryland tax purposes. More